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I think there is something to be said for keeping MOTs for ALL vehicles, or, dependent upon the age and features/performance (not just speed, braking performance, handling, tyres that have to be used) of the vehicle, though it may be worth doing the following, including as others have suggested:
Having a cap on the annual mileage groups (to be determined as explained above) of older cars, and perhaps the times of day, type of road (they would have to be capable of travelling at the maximum speed of that road for extended periods safely [TBA]) or even days of the week/road conditions the can be driven in. As many have said, most 'classic' cars tend to be very well-maintained (if driven) 'show' cars and mostly taken out on the road on weekends/and or in good weather.
A 'licence' for such cars, similar to driver's licences, could more formalise this, including temporary ones when travelling to a show or specialist repairer, except for use on motorways (e.g. for really old cars not capable of safely travelling on them for extended periods at high speed).
I think that the 'rolling' period that the government is now using to designate a car as 'classic' and not needing to pay VED should only be valid IF the owner can prove they do less than X miles per year; the same would go for any reduction in the frequency of MOTs. there is a significant difference between a pristine old car being used once a month at weekends and someone barely maintaining an old car as a day-to-day car because they can't afford to properly (as it would be for any car, including newer ones).
To be frank, many very old cars, even if pristine, are potentially very dangerous to other road users and pedstrians if used on busy roads in peak periods (many proper classic cars were built when there wer far less people and only a few other road users, let alone cars about) or in bad weather (unless they are closed specially for a 'classic rally' or suchlike), as many either drive way too slowly, hold up the traffic and induce other road users to take risks (and get angry when they don't pull over [a bit like caravaners], unlike farm vehicles which often do) to overtake, or, if they do drive at the speed of the other vehicles, they do not have the brakes to stop sufficiently quickly when required (why there were so many accidents in days of yore, especially before the manditory introduction of seat belts.
In my opinion, most proper classic car owners (as I said earlier) are acutely aware of this and travel when its more appropriate and don't use them as a 'regular' car, however some people do and will need to kept an eye on. It may mean that some classic cars cannot be driven on the road because they cannot comply with modern minimum safety regulations (showing particular indicators etc) so can only be driven on private land (classic car shows for example), but I would summise that most can, perhaps with some limitations as described above, or with minor modifications.
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